There has been a wave of cautious optimism about the CBA negotiation over the last few weeks. Oowners met as a group last week to get everyone on the same page as to how the negotiations were going and followed that up with another round of talks with the players. While both sides are under a court-mandated blackout, reports have trickled out that there wasn’t much resistance from ownership and while the players don’t love the new deal, they will live with it.
Follow that up with reports coming out that another round of talks will be held in Boston/Minnesota and it’s understandable that NFL fans are happy to see significant progress being made. Amidst all this optimism, some aspects of the new deal have been leaked out. Will this change the way the Packers do business?
- Players will earn somewhere around 48% of revenue: Perhaps the biggest roadblock between the owners and the players is how much of the pie everyone gets.
- Effect on the league: Some teams will definitely be hit harder than other teams; while Jerry Jones and the Cowboys probably won’t be affected that much due to their massive profit margins, small market teams such as the Jacksonville Jaguars could feel the financial pressure of keeping up with the rest of the league.
- Effect on the Packers: As a community owned/non-profit organization, the Packers fiscal responsibilities have always been a little different from the rest of the league. Other teams have owners who can move profits and assets to other ventures or simply take profits for themselves; for instance there have been reports of the Glazer family using the profits from the Tampa Bay Buccaneers to cover for the financially struggling Manchester United, which is great for the Glazer family but terrible for Bucs fans. The Packers on the other hand by default have to put all their profits back into the team or into charities.
- The cap floor will be higher: There are rumors that teams will be required to spend somewhere in the 90-95% of their salary cap every year. Salary Cap calculations are also to be simplified with less “dead money” contributing to the cap.
- Effect on the league: Several notorious penny-pinching teams such as Carolina Panthers are going to have to open their checkbooks in order to get above the salary cap floor. Again smaller market teams may feel more financial stress with having to put so much money into player’s salaries.
- Effect on the Packers: This probably won’t affect the team that much, a little known fact is that the Packers had one of the highest salary caps in the NFL in 2010. This is probably due to the fact that the team took advantage of there being no salary cap last year and structured several contracts to be very front-heavy.
- Free agency will return: Several different possibilities have been brought up, in one scenario all players with 4 years of vested service will become unrestricted free agents and in another a staggered system where free agent status will be determined by the round in which they were drafted in, with high draft picks having to wait longer than low draft picks
- Effect on the league: Nothing substantial has been reported about restricted free agency, but for teams who sign or trade for many free agents, such as the New York Jets, it will be much harder to keep all their players on the roster. The rationale behind capping rookie salaries is to put more money into proven veterans and as such, veteran free agents are likely to be getting bigger and bigger contracts as the new cap system settles in.
- Effect on the Packers: Again the Packers shouldn’t be affected as much as some other teams in the league. Ted Thompson is well known for generally ignoring veteran free agency and locking up his own players before they get a chance to hit the open market. For instance in this year, the only big free agent that might be effected by the new CBA is wide receiver James Jones, and Ted Thompson’s MO has always been to have a player’s replacement on the roster (hence why Randall Cobb was drafted in the 2nd round this year).
- Rookie contracts will be capped: This was pretty much a given that the rookies were going get thrown under the bus in the new deal as both owners and players were complaining about the ludicrous contracts 1st round picks were receiving up front.
- Effect on the league: This will be an enormous help for teams perennially in the top 10 of the draft. Teams also might be more willing to take bigger risks as the financial repercussions may not be as significant as they are now (See JaMarcus Russell). In reality no team is immune to getting a high draft pick (Thompson himself has had two during his tenure, AJ Hawk and BJ Raji), so every team should benefit.
- Effect on the Packers This actually might be the biggest change for the Packers, as Ted Thompson is well known for trading back for value, but with a new rookie cap in place, Thompson might have to reconsider his strategy and actually trade up more since now the best value is likely to be in the top of the 1st round (where it should be). While Thompson was likely operating at a higher cost efficiency than other teams due to his MO under the old CBA, this might not be the case with the new deal.
- Roster sizes will be increased: In response to the increasing amounts of injuries that are occurring, the league may increase the off-season roster from 80 to 90 and even include an extra spot on the practice squad or even on the 53-man season roster.
- Effect on the league: Teams will be able to bring more players in for training camp and most likely several unknown players will have a shot to compete where they wouldn’t have had otherwise. Chances are this will help players who are considered “developmental” since teams will now have the roster space to sign high-risk, high-reward type of players. Teams might also keep more niche players, such as kick-off specialists or special teams gunners.
- Effect on the Packers: This is perhaps the biggest advantage that the Packers will gain since Thompson has proven himself capable of finding diamonds in the rough (See Tramon Williams/Sam Shields). It will also allow Thompson to keep more developmental players on the roster, which should be a huge benefit since the Packers are good at developing their own players instead of having to sign expensive free agents.
- New drug testing: Also another given after the NFL saw the fallout that the steroid scandals that rocked the MLB recently; the NFL wants to continue to cultivate its image as a sport of parity and it knows that it would be a PR nightmare for players to openly criticize more drug testing.
- Effect on the league: Undoubtedly, there are players on every team using some form of performance enhancing drugs and no amount of testing is likely to change that. But some teams that have cultures that promote or “look away” in regards to performance enhancing drugs are likely to be effected more than teams that do put more emphasis on it
- Effect on the Packers: The Packers aren’t immune to performance enhancing drugs and it’s just as likely that a Packer player will be caught using performance enhancing drugs as any other player.
So in conclusion, overall it looks like the Packers should weather the new CBA changes better than some other teams. The Packers have proven that they know how to build and run a football team during Ted Thompson’s career with the Packers during the old CBA, will he be able to do the same with the new CBA?
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Thomas Hobbes is a staff writer for Jersey Al’s AllGreenBayPackers.com.
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Very interesting article! Very well done Thomas!
The 90% – 95% floor seems to be the real issue for owners. The Bengals are one example. They made a Net of $49 mil vs. $9.5 for the Packers. It is obvious that some owners are driving the profit line at the expense of team quality. The small market teams will be most affected and the risk of teams becoming the Mets and Dodgers will be increased.
Jones and his buddies will be able to hide revenue in other ventures not directly related to the Football operations. This, of course, will give them a substantial advantage over teams that are dependent only on direct football revenue. I think that supporting 32 teams will become more and more difficult.
But, who gives a crap if the Queens move to LA. I want my football and I WANT IT NOW.
Ron, I do not follow your logic as to why it will be harder to support 32 teams. From what I have read revenue sharing and the majority of the basics will still be in place. Ownership is getting a bigger piece of the pie (albeit they have to spend more of their piece). Revenues are expected to increase due to the real possibility of an 18 game season and a full thursday night schedule. I am not saying that i see expansion, but the league looks perfectly capable of supporting 32 teams for atleast the forseeable future.
With the current revenue sharing some teams are often limiting payrolls even though their bottom lines are good enough to spend more. Cinn. is an example. If they spend up to the floor they lose money. How many small market teams are in jeopardy now? That number will only grow if they are forced to spend more.
I have a friend that’s a Bengals fan (be nice) and he says that the Bengals spend money on players for the most part, the problem is they don’t spend a dime on state of the art facilities or medical staff.
But you stated that the bengals had a net of 49. They can afford to spend more, they just do not do it. Every team should be able to afford spending 100% of the salary cap, that is the entire point of the salary cap. That is why the NFL uses revenue sharing. The owners may be able to put less into their pockets at the end of the day, but they are still going to be in the black. Right now, with the amount of money that is coming in from TV contracts and the future revenue that will be coming in soon, it would be nearly impossible to lose money with an NFL team.
Also, it sounds like they are going to do away with some of the dead money as it relates to the salary cap, but just because your salary cap says you are spending 95 million, that does not mean you are actually spending that much. I just wonder with the requirement of spending 90-95% of your cap, if expiring contracts will start to hold value like they do in the NBA.
The way TT has built this team and his philosphy in building it seems to be able to weather whatever the new (or old) CBA can throw at him. Glad he’s our GM.
Good article Thomas. Happy 4th to all!
A nice summary.
Chazman, you could not have said it any better.
The Glazers are taking money out of United to pay back the loans they used to buy the club. Obviously the Buc’s don’t release their figures but you can book that United earn multiples of their operating profit. So while it’s the opposite of what you claim it still proves the point.
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